Julian Granados Galvis

• Payments for Environmental Services (PES) are economic mechanisms to compensate actors for providing environmental services. Distributed Ledger TEchnologies (DLTs) are a system of electronic records that enables a network of independent participants to establish a consensus around a set of transactions. They are distributed databases organised as a chain of ordered information blocks, recorded by a network of computers. DLTs enable the appearance of innovative applications (such as smart contracts, tokens, wallets and programmable money) to tackle recurrent PES issues and implement PES design advice found in the scientific literature. They also promise to facilitate new collaboration infrastructures for independent actors that pursue a common environmental goal. Through a common authoritative ledger that serves as a synchronizing backbone for managing interactions between independent network participants, DLTs enable coordinated collaboration efforts based on the transparent transaction of financial resources, the collective management of information regarding the state of the environmental resources and the management of activities that impact its transformation. This study investigates how blockchain technologies might contribute to the success of PES schemes by lowering information asymmetries and transaction costs, by enabling the appearance of blockchain-supported applications that tackle specific PES deficiencies and by providing new institutional alternatives for governing the interaction of individuals for a common (environmental) purpose. This study proposes that blockchain-supported applications are likely to improve current PES schemes by making them more transparent, by reducing the costs associated to maintaining trust and by reducing the need for certain intermediary services. It also envisions new types of peer-to-peer payments for environmental services emerging as a consequence of decentralization and distributed ledger technologies.